Simple and Compound Interest Quiz
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Name:____Answers___
Math 10 GMF
Part 1 – MC (value 7) Choose and place the capital answer in the space to the right
1. Determine the annual interest rate (to the nearest tenth of a %) if an investment of $1450 earned
$120 in simple interest in 9 months.
A) 11.0%
B) 9.2%
C) 6.2%
D) 10.5%
__A__
2. A deposit of $1450.00 is invested at 2% per annum, compounded quarterly, until being withdrawn
after 56 months. How many interest periods were there?
A) 56
B) 4.7
C) 18
D) 19
__C_
3. What will be the future value of a $5000 investment earning 7% interest, compounded annually, for 6
years?
A) $7012.76
B) $7100
C) $7503.65
D) $6750
___C_
4. Which of the following represents the use of the Rule of 72 to estimate when the investment from Q. 3
will double in value?
A) 72
B) 72
C) 72
D) 0.07
__B__
0.07
7
6
72
5. What amount of interest will be earned from an $1800 investment earning 6% interest, compounded
quarterly, for 6 years?
A) $648
B) $753.33
C) $1968.20
D) $773.11 __D__
6. What amount should be invested now in order to accumulate a total of $6116.63 in 4.5 years, earning
3.4%, compounded monthly?
A) $5400
B) $5250
C) $5115
D) $5300
__B__
7. Jane asked for a loan of $16 000 from her bank for a car purchase. The bank offered financing at
5.75%, compounded monthly, for a term of 3 years. What is the total amount that would be owed at
the end of term if no payments are made during the three years?
A) $16 372.17
B) $18 966.15
C) $19 004.52
D) $20 126.54 _C___
Part 2 - Open Response: Show your work in the space provided.
(value 13)
1. Determine the annual interest rate (to the nearest tenth of a %) if an investment of $1450 earned
$120 in simple interest in 28 months. (value 2)
3.5%
2. Use the Rule of 72 to estimate how long it will take for a $4200 investment to double in value if it is
earning 4.3% interest, compounded semi-annually? (value 2)
Approx 17 years
3. Katie intends to invest $4300 in a GIC earning interest that is compounded monthly. If she wants it
to grow to $8000 in 6 years time, then what annual rate of interest does she require?(rounded to the
nearest tenth of a %) (value 3)
10.4%
_________________
4. After 16 years of investing her savings, Sydney withdrew a total of $32 813.98. What amount of
interest must she have earned if the original investment was at 4.32%, compounded quarterly?
(value 3)
$16 313.85
_________________
5. An investment of $6000 earned $1500 in interest in 10 years. What was the annual interest rate if it
was compounded monthly? (round to the nearest tenth of a %) (value 3)
22.3%
_______________